However, it should be made clear at the outset that BATNA is not the so called bottom line that negotiators perceive as the means to guard themselves against reaching agreements where they give too much or receive too little. Their book is the most solid framework for how to approach negotiations I have read. You start off with your 'walking-in' BATNA; the things you can influence or control before the negotiation begins. It is defined as the most advantageous alternative that a negotiating party can … 2) Added Confidence So your BATNA changes as new cards come into your hand. The exact opposite of this option is the WATNA (worst alternative to a negotiated agreement). The alternative that best meets your interests is called your BATNA (Best Alternative To a Negotiated Agreement).Understanding these concepts and how to utilize their power in negotiations will help you reach more satisfying outcomes in your negotiations. Why Use BATNA (Best Alternative to a Negotiated Agreement)? The worst that can happen if you lose the negotiation. Question: Can you please explain BATNA to me and tell me how it is useful in negotiating? They will be exposed to: We welcome the republication of this page's contents in part or full - we just ask that you include a clean link back to this site, to our www.negotiationtraining.com.au/training/ page. Thanks for clarifying!". Not to mention the economic ties and heavy investments of the Brits. If those new cards are only known to you, you develop a greater understanding of your own apparent strength. Related Content. Considering a WATNA means that each party thinks about what their losing scenario looks like. You buy upwards of 500 widgets a year or the equivalent of $500,000 of product a year. If you have any time, I've just written a blog on BATNA and negotiation http://rolesrelations.wordpress.com/2013/03/18/buying-with-batna-gone-in-60-seconds/ It explains the process, related to selling a car. In this scenario, both parties would be better off to seek elsewhere to pursue their business. If negotiated agreements are absent, you will be forced to enter negotiations hoping to get just a satisfactory agreement. Judgments and Decisions Psych 253 Negotiations 2. A significant reality check on any party's BATNA/WATNA analysis is the other party's assessment of the same case from the other side. Importance of WATNA as a negotiation tactic. As most business negotiators are already aware, BATNA is an acronym for (Best Alternative To a Negotiated Agreement). If you are offered a used car for $7,500, but there's an even better one at another dealer for $6,500- … In any negotiation, it is important to make sure that you establish your best alternative, but also your worst so you can weigh your options with greater accuracy, and, hopefully, better results. A WATNA is the worst possible outcome a party has in mind. However, the Chinese learnt their lessons on the importance of maintaining good relationship after negotiation, thus gave the Britts plenty of economic manoeuvring room to continue their prosperity. Although bottom lines definitely serve a purpose, they also regrettably foster inflexibility, stifle creativity and innovation, and lessen the incentive to seek tailor-made solutions that resolve differences. The BATNA is even more important than the WATNA. It has no external reference point. In negotiation theory, the best alternative to a negotiated agreement or BATNA (no deal option) refers to the most advantageous alternative course of action a party can take if negotiations fail and an agreement cannot be reached. New and immediate tools. When negotiations begin, establish rapport and try to get the other side … In many card games, your hand may change during the play as new cards are dealt to you (and others). Let’s suppose you’re buying widgets from your supplier for $1,000 a widget. As a gauge against which an agreement is measured, it prohibits a negotiator from accepting an unfavourable agreement or one that is not in their best interests because it provides a better option outside the negotiation. In particular, one party's assessment of their best case outcome may look quite different from the other party's assessment of their worst case outcome. A BATNA is the best alternative to a negotiated agreement, and the WATNA is the worst alternative to a negotiated agreement. This makes it a 170 year history - not 2,000 years. By Edrie Greer, Ph.D., Global Knowledge Instructor Negotiation is one of the oldest problem-solving methods in the world. In situations where both parties possess a similar or superior BATNA, then given similar negotiation skills, negotiation would seem rather fruitless because there would be very little incentive to reach an agreement. Since its usually the last resort, the other party involved has to accept the BATNA presented or lose the negotiation. Comments: 5. Returning to my situation, I looked at the worst case scenario and went pretty far down that rabbit hole. Also, for focusing on purposeful negotiations, your WATNA is crucial. Since BATNA is the alternative to what a negotiated agreement would be otherwise, it permits far greater flexibility and allows much more room for innovation than a pre-determined bottom line. Never.” (Rivlin 2000) In the course of transforming pharmaceutical startup, Millennium Pharmaceuticals, into a multibillion dollar enterprise, then Chief Business Officer It is thus important to also consider the other side of the coin, embodied by the concept of WATNA, or the Worst Alternative to a Negotiated Agreement [13,16, 17]. Good article and comments overall.". At least that was my interpretation. For example, an employer may be willing to risk significant losses, at high costs, to maintain a reputation that they do not settle While preparing for a negotiation, it is important to estimate the Reservation Value of your counterpart. The previous article discussed the importance of moving through a BATNA/WATNA analysis to discover the true interests at the center of a dispute. Your walking-in BATNA may be the first cards you are dealt. Here’s a classic illustration of the BATNA negotiation skills concept: Negotiation skill or negotiation strategy? BATNA, however, covers far more than that. In other words, what, realistically, is the best outcome if you went to court, and what would be the worst outcome. Response: BATNA is the acronym for Best Alternative To a Negotiated Agreement. Brits knew how costly and risky to engage an immediate war with China that has nuclear capabilities. Establishing the BATNA, MLATNA and WATNA can help negotiating parties to evaluate their options. A war would be a painful one. You can think of BATNA in negotiation like playing a game of cards. 9 of 12 people found the following comment useful: "Tom-if read carefully, William was not implying the Opium war was 2000 years ago, he was implicating the Chinese have had negotiation "skill and strategy" which he claims has been recorded in history books dated 2000 years ago. It allows the parties to create perspective on the options that they are thinking about. However, the Chinese learnt their lessons on the importance of maintaining good relationship after negotiation, thus gave the Britts plenty of economic manoeuvring room to continue their prosperity. Spotio suggests that in deciding whether a BATNA should be revealed to the other party/ parties will depend on the strength/attractiveness of the BATNA. 2 pages) Ask a question Glossary WATNA. The solution is to know your BATNA and WATNA. Get The Other Side Talking. By looking at BATNA as an ongoing, changing measure of negotiating strength, as a mechanism for deciding whether and/or when to quit, we develop a disciplined, informed approach to our negotiations. BATNAs are critical to negotiation because you cannot make a wise decision about whether to accept a negotiated agreement unless you know what your alternatives are. It is crucial to think of BATNA as having two stages in a negotiation. Importance of ADR in India. A concept developed in the context of negotiation theory. The BATNA and WATNA are important in terms of the endgame because it helps people evaluate how good or bad their options are. BATNA is an acronym that stands for B est A lternative T o a N egotiated A greement. Going to the worst case scenario in your negotiation preparation has a particular benefit: you might reconsider your bottom line. The 'willingness' of a negotiator to break off a negotiation allows the negotiator to adopt a more firm and forceful stance when proposing ideas and interests as the basis for an agreement. If you look at your situation in the absence of a negotiated agreement, and find it almost unthinkable, you will be pressed to enter negotiations in the hope of getting a satisfactory agreement. 29 of 42 people found the following comment useful: "When Qing Dynasty negotiated during post Opium War, they did not have any BATNA and the Brits knew. It's all very well determining and assessing your best alternative, but are there any skills that you should acquire in order to achieve a positive agreement? A bottom line or walk away signifies the worst possible outcome that a negotiator might accept. If other parties need you in order to reach their objectives, your BATNA is strong; your negotiating circumstances are strong. Britts had no BATNA and was unable to create one, not after the Falkland Island War. We know what we will do if the deal falls through, which makes us less likely to dip below our bottom line, make desperate or unwise concessions, or fail to ask the other side for what we really want. Using negotiation lingo, alternatives are what you could do to meet your interests if you walked away from the current negotiation. Getting to a BATNA usually involves several steps: If mediation appears to be fruitless, it is helpful to provide a fresh perspective on the problem. As suggested earlier, BATNA/WATNA analysis can also be less influential where parties simply refuse to give it meaning because they can afford to do so and have other interests that are more important to them. Reading comprehension - ensure that you draw the most important information from the lesson on BATNA and WATNA, such as which concept is employed in a given scenario A bottom line is set arbitrarily. Without BATNA, this time, the Britts have to follow the old path of negotiation--concession. The conclusion may be correct. The negotiator would then know the consequences should the negotiation fail. It is not supported by the evidence presented.". With regards to William Li's response, the first Anglo-Chinese 'Opium' war was fought in the late 1830s/early 1840s. Brainstorm a list of all available alternatives that might be considered should the negotiation fail to render a favourable agreement; Chose the most promising alternatives and expand them into practical and attainable alternatives; and. This can help you determine if a potential settlement offer should be accepted or refused. Is the WATNA better than satisfactory? If you want to buy a new car and the same model is for sale at several car dealers, you have a strong BATNA because you can benefit from their competition for your business. Average Reader Rating: They will become beholding to the whims of the law of agreement, which holds that when persons agree to something this is entirely dependent on the attractiveness of the available alternatives. You should always consider the worst case scenario before negotiating. However, once negotiation starts, the BATNA is a dynamic element, changing as you derive information about the interests of other parties and their constituencies and as you compare the resources each party (including you) has available to bring about and fulfill an agreement. BATNA is Only Part of the More Important Focus, Negotiators’ Bottom Lines Because BATNAs are so dang shiny, people often think that they should be the main focus of negotiators’ analysis. 11 of 13 people found the following comment useful: "When I read "Getting to Yes with yourself", one of the latest additions to the Getting to Yes series, it introduced he BATNA concept but it wasn't until I read this article, that I truly understood the difference between the BATNA and the bottom line. When a negotiator has a strong BATNA, they also have more power because they possess an attractive alternative that they could resort to if an acceptable agreement is not achieved. 33 of 37 people found the following comment useful: "Having read and put into practice the Harvard Negotiation Project's 'Getting To Yes: Negotiating Agreement Without Giving In', I believe the article here is well written. WATNA stands for the Worst Alternative to a Negotiated Agreement. When considering the BATNA, MLATNA, and WATNAs, each party should consider what alternative paths exist if … "Zone of Possible Agreement (ZOPA)" is the range in which an agreement is satisfactory to both parties involved in the negotiation process. A BATNA, on the other hand, is a course of action which is available should a negotiator be unable to reach an agreement in the negotiation. I can see how BATNA is very useful in negotiation and bargaining - especially in sales - but sales is mostly about relationship building and correct communication. Qing government had no alternatives (so they thought), and unwilling to create new BATNA, led to the concession of Hong Kong. From: Jackol, Hong Kong. ", © Copyright 2017 Negotiation Training | E-mail us 1) Increases negotiating power Having a BATNA increases your negotiating power and brings to a consensus which is more in favor of the party holding BATNA. I highly recommend it. WATNA Practical Law UK Glossary 7-205-6261 (Approx. Analysis and discussion of how to determine what each party’s BATNA and WATNA is and then the best ways to utilize this knowledge will be the focus of this set of articles. It is a continuation of BATNA, except you are looking at the worst-case scenario and evaluating potential negative outcomes. Regards - Josh". Question: Can you please explain BATNA to me and tell me how it is useful in negotiating?. You've been extremely thorough in your explanations, however, I have also learnt of your WATNA - Worst alternative - and although I acknowledge this is a genuine term, I can't but help feel that it is a little obvious and pointless to determine your 'WATNA'. Identify the best of the alternatives and keep it in reserve as a fall-back during the negotiation. observation is the importance of developing your BATNA before negotiating. It is a means to defend oneself against the pressure and temptation that is often exerted on a negotiator to conclude an agreement that is self defeating. This article explains how a negotiator can use their BATNA to achieve a better bottom line instead of settling on a bad agreement. The word “satisfactory” is important here. A well conceived and clearly defined BATNA gives a skilled negotiator the advantage to break off the negotiation if it becomes clear that a beneficial outcome is not possible. In negotiation, rather than looking at cards, we are assessing information about our own resources, those of other negotiating parties, and the influences on each negotiator from their constituencies. A bad BATNA is also known as a WATNA, or worst alternative to a negotiated agreement. To deal with the situation of pendency of cases in courts of India, ADR plays a significant role in India by its diverse techniques. One view says that BATNA is the measure of the balance of power in a negotiation. BATNA stands for ‘Best Alternative to Negotiated Agreement’ and WATNA stands for ‘Worst Alternative to Negotiated Agreement’, first conceived by Roger Fisher and William Ury in 1981. It is a clearly identifiable course of action. If you look at it from the simplest standpoint, your BATNA is the choice you can make if you conclude that negotiating with a particular party is not likely to yield a favorable result. Without knowing them, you could end up accepting an offer you ought to reject. If you have invested time in finding out what your BATNA is, you deepen your power and are more able to negotiate confidently. In litigation, the BATNA value (the expected value of the court outcome) is only one element of one’s bottom line (aka “reservation price”). When it comes to understanding the bound of the brits or walk away from negotiation! In reserve as a fall-back during the negotiation begins is another objective that. 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